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November 2024

The maximum marginal rate is to be computed by taking the maximum rate of income-tax and maximum rate of surcharge applicable in the case of an individual. It is this rate which applies to a private discretionary trust as well. The levy of maximum marginal rate on trust is thus specific anti avoidance rule and therefore, should be given a strict interpretation.

By Jagdish T Punjabi, Chartered Accountant
Devendra Jain & Aditya Bhatt, Advocates
Reading Time 6 mins

51. Aradhya Jain Trust vs. ITO

TS-741-ITAT-2024(Mum.)

ITA No. 2197/Mum./2024

A.Ys.: 2022–23

Date of Order: 7th October, 2024

Sections: 2(29C), 167B

The maximum marginal rate is to be computed by taking the maximum rate of income-tax and maximum rate of surcharge applicable in the case of an individual. It is this rate which applies to a private discretionary trust as well.

The levy of maximum marginal rate on trust is thus specific anti avoidance rule and therefore, should be given a strict interpretation.

FACTS

The assessee, a private discretionary trust, filed its return of income declaring total

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